Your Software Applications – Build or Buy?

August 20, 2016

We often meet businesses looking for a system that will help their business, but they aren’t sure whether to go out and review what’s in the marketplace, or look to develop their own.

These days of course, virtually all businesses use off-the-shelf technology for their general needs such as email and collaboration, accounting, timesheets, and billing. Our involvement is normally in specific systems that are used by individual industries, such as financial markets, media, automotive, government, sport etc. It’s within the scope of a single industry or type of business that the decision becomes more complex.

There are a number of reasons why businesses start to look for systems:

• Start-ups requiring a system to run some aspect of their marketing or operations

• Growth in an existing business requiring a change or more efficiency in process

• Dissatisfaction or limitation with current software

• A change in a business requiring new or unique processing

• Software products are your business

With the exception of unique processing, all of these situations warrant a review of existing systems that may fulfil a similar need. This is true even when software products are your business, because it may make sense to license existing software, perhaps with your own branding or front-end.

So how do you go about making the decision?

Here are some questions to ask:

How generic are your requirements?

Unless your business is intending to take on the likes of Microsoft or Google, exceptionally few businesses would have need to develop a dedicated email system, but your requirements might be more generic than you think. If they are then it’s likely there will be many good systems available in the marketplace at reasonable cost (or even free in some cases).

Are existing solutions expensive?

Possibly a vendor has a strong market position and well-regarded platform, but often it is because the software that is available includes many features and functionalities that you will not need and cannot be licensed without those additional parts. In this case it may make financial sense to develop a cut-down or more specialised version of an existing product. Several of our clients in financial markets fit into this category – systems are available but they only require a small subset, for example for compliance reporting of a specific kind.

Are your requirements truly unique, or close to?

Here’s where you will obviously consider a development. It’s likely that your business itself is also unique, and hence the software you use will become an integral part of your competitive edge. There are examples of this on our website – a media planning system that was required for planning and measuring buying effectiveness. There was no such system available because the approach to the business was unique. Or a video sharing website providing full control over advertising revenue to channel owners.

Are you a software vendor yourself?

In this case the decision is complicated by the fact that if you buy off-the-shelf software to re-package yourself, you will need to establish licensing agreements for branding and distributing that software. Also, you may need to control the future direction of this software, which you can only do if you own the source code or are allowed to modify it yourself (such as with most open source components)

Do you need to control the future direction of the software?

Whether you are a vendor as above, or a company whose fortunes depend on the ability to evolve internal processes at your own pace, you can only really do this if you own the source code and are able to direct future development.

How quickly do you need a solution?

Normally bespoke development takes a lot longer than setting up an off-the-shelf product, even where a lot of customisation is needed. These days the wide availability of Cloud-based systems has speeded up the setup process massively. Another option might be to use an off-the-shelf solution for the short term while building a more suitable bespoke version. This has the advantage of easing the pressure on the bespoke development project timeline.

Are you unhappy with your current system?

Whatever the reason for your dissatisfaction, it may be time to look around. Hopefully you will have a good enough idea of what you need (and don’t need) that you can make a highly informed decision, and provided your existing solution sat least gets you through the day, you have time.

So, build or buy?

The best reasons to buy are:

• The functionality is very generic, and you don’t need to ‘reinvent the wheel’

• Cost – this partly relates to the point above. Software development can be expensive and time consuming, and it may be a lot cheaper and easier to license software already available in the marketplace

• Timeframe – if you need a system very quickly then buying one readily available in the marketplace may be your only option in the short-term

The best reasons to build are:

• Uniqueness – your business or process is very unusual, or in the case of many websites, it needs to look unique

• Control – you need to be able to make changes at will (you could of course buy the source code, if available, to achieve this)

• Lower cost – this will normally only be the case where you only need part of a bigger system that is already available off-the-shelf

How can we help?

The Bridge are passionate about building software to help our clients’ business’ grow.

At the same time, we appreciate that a development project may not suit you at this point in time, but we know what high quality software looks like and we can help you to assess off-the-shelf products.

So please contact us if you are looking for a new system, whether your inclination is to buy or build, we will provide an honest, unbiased assessment.

If you’d like to discuss your software development options with The Bridge at no cost or obligation, feel free to call Lawrence on 02 9993 3300 or email lawrence@thebridgedigital.com.au